Narrative
Full Description
Project narrative
On November 7, 2014, during the Beijing APEC Summit and under the witness of Xi Jinping and President of Tajikistan Emomali Rahmon, China Eximbank and Tajikistan's Ministry of Finance signed two loan agreements for the Flouride Salt Project: an RMB 248.3 million government concessional loan (GCL) and a $53.1 million preferential buyer’s credit (PBC). The GCL, which is captured via Record ID#71391, carries the following borrowing terms: a 20 year maturity, an 11 year grace period, and a 1.5% interest rate. The PBC, which is captured via Record ID#53755, carries the following borrowing terms: a 2% interest rate, a 20 year maturity, and a 9 year grace period. The PBC and GCL agreements were ratified by the Tajik Parliament on January 14, 2015. The borrower was expected to use the proceeds of the GCL and the PBC to finance a a $126 million commercial (EPC) contract between Tajik Aluminum Company (TALCO) and China National Heavy Machinery Corporation (CHMC), which was signed on July 24, 2014. The project included the construction of three large plants in the Yovon District of Khatlon Region: a plant for the production of aluminum fluoride with annual capacity of 18,000 tons, a plant for the production of cryolite with annual capacity of 12,000 tons, and the plant for the production of sulfuric acid with annual capacity of 130,000 tons. These three plants were sometimes referred to as three separate projects: the Cryolite Project, the Aluminum Fluoride Project, and the Sulfuric Acid Project. The project site is located in Yovon District within Khatlon Region. Its exact locational coordinates are 38° 32' 45"N, 68° 13' 31" E. CHMC was the EPC contractor responsible for project implementation. Construction began in June 2015 and the three plants were completed and officially inaugurated by Tajikistan President Emomali Rahmon on September 6, 2016. On October 17, 2019, Mr. Guo Mo, the National Manager of the Sovereign Business Department of China Eximbank, and other two officials, conducted an on-site, post-loan project inspection.
Staff comments
1. The Chinese name of the project is 塔铝项目. The Russian name of the project is Строительство заводов по производству криолита, фтористого алюминия и серной кислоты в рамках реконструкции и модернизации ТАЛКО. 2. Aluminum fluoride is an inorganic compound used primarily in the production of aluminum. This colorless solid can be prepared synthetically, but also occurs naturally. Aluminum fluoride is an important additive for the production of aluminum by electrolysis. Together, with cryolite, it lowers the melting point to below 1000°C and increases the conductivity of the solution. Cryolite was historically used as an ore of aluminum, and later in the electrolytic processing of the aluminum-rich oxide ore bauxite. The difficulty of separating aluminum from oxygen in the oxide ores was overcome by the use of cryolite as a flux to dissolve the oxide minerals. Pure cryolite melts at 1012°C, and it can dissolve the aluminum oxides sufficiently to allow for the easy extraction of the aluminum by electrolysis. Substantial energy is still needed for both heating the materials and the electrolysis, but it is much more energy-efficient than melting the oxides themselves. Since natural cryolite is too rare to be used for this purpose, synthetic sodium aluminum fluoride is produced from the common mineral fluorite. Sulfuric acid has a wide range of applications, including domestic acidic drain cleaner, electrolyte in lead-acid batteries, and various cleaning agents. It is also a central substance in the chemical industry. Principal uses include mineral processing, fertilizer manufacturing, oil refining, wastewater processing, and chemical synthesis. It is widely produced with different methods, such as contact process, wet sulfuric acid process and some other methods (see "http://www.sulphuric-acid.com/sulphuric-acid-on-the-web/acid%20plants/TALCO.htm"). 3. The Tajik Aluminum Company is one of the ten largest aluminum smelters in the world. It provides up to 70% of Tajikistan's foreign currency earnings while consuming 40% of its electrical power. TALCO is wholly owned by the Tajik Government. Tajikistan does not mine alumina, but imports the raw material through tolling arrangements. 4. The face value of the GCL is drawn from a Tajik Ministry of Finance source (http://minfin.tj/downloads/ochet%20vnesh%20dolg_2014.pdf).